THE 



NECESSARY FOUNDATIONS 

OF 

INDIVIDUAL AND NATIONAL 


WELL-BEING, 


AND OF 


: #?%y 

CIVILIZATION U 


A LECTURE 

Delivered before the Broohlyn Revenue Reform Club, February 28th, 1883, 
and before the Young Republicans of Philadelphia, March 31, 1883, 


BY 


HENRY CAREY BAIRD. 


“ The first, the greatest, the paramount need of man is that of association — the exchange 
of services, commodities and ideas — with his fellow-men.” 


♦ 


?»;ii 




PHILADELPHIA: 


HENRY CAREY BAIRD & CO., 

INDUSTRIAL PUBLISHERS, BOOKSELLERS AND IMPORTERS. 

810 WALNUT STREET. 

1883. 




THE NECESSARY FOUNDATIONS 

OF 

INDIVIDUAL AND NATIONAL WELL-BEING, 

AND OF CIVILIZATION. 


Permit me to direct your attention 
this evening to the theme, The Neces- 
sary Foundations of Individual and 
National AVell-Being, and of Civiliza- 
tion. 

Unsettled Condition of Political 
Economy. 

To hear a certain school of political 
economists and their followers, here 
and in England, dogmatically lay 
down the law, and even insist that the 
case was closed, one would hardly 
imagine that their dogmatisms came 
within a department of knowledge in 
which nothing whatsoever was placed 
beyond dispute. But in Political 
Economy not even the definition of a 
single important word— political econ- 
omy itself, for instance — is settled. 
In 1844 De Quincey, a believer in Ri- 
cardo’s Theory of Rent, one of the 
orthodox principles, said of Political 
Economy: “Nothing can be postu- 
lated, nothing can be demonstrated, 
for anarchy even as to the earliest 
principles is predominant.” 

Nothing is to be taken for granted. 
This fact cannot be too distinctly im- 
pressed upon your minds and memo- 
ries. The professors are not even 
agreed as to whether it is a science or 
an art, or a combination of both, or 
upon the proper and legitimate range 
of the subject. Therefore is it that 
they are ab initio morally debarred 
from the practice of dogmatism ; and 
yet with all of these causes, impelling 
toward modesty, the average political 
economist is seemingly more confident 
in his opinions, and certainly more 
overbearing and arrogant in the ex- 
pression of them, than any other man- 
ner of man to be found in any com- 
munity. Among the believers in 
England in what arrogates to itself 
the name " free trade — merely free 
foreign tr *or instance, disbelief 
in this vgarded, ipso facto , 

as a: rnh ignorance in 

the is considered 

a to argue the 

then and 


there put down with the expression of 
opinion that the argument is complete 
and the question decided, and that he 
is an ignoramus if he does not know 
and recognize these facts. It need 
hardly be urged that this is not the 
spirit in which to approach the inves- 
tigation of truth. Indeed, the exist- 
ence of this spirit is proof conclusive 
that these philosophers and their fol- 
lowers lack full faith in the truth of 
the doctrines which they would thus, 
without reason, force upon the accept- 
ance of mankind. 

For myself, coming here as I do, a 
believer in and a representative of that 
noblest of all the sciences, the scientia 
scientiarum , the American, or, if you 
please, the Pennsylvania System of 
Social Science, founded by my late 
kinsman, Henry C. Carey, I have em- 
phatically to say, that I come not as 
an apologist for Protection, or for the 
science upon which it rests. I stand 
not on the defensive; but I assume 
the aggressive. This aggression shall 
strike at the very roots of the system 
of Political Economy, the “ dismal sci- 
ence ” of Carlyle, or more properly of 
Robert Southey, upon which is built 
the huge and arrogant superstructure 
falsely denominated free trade ; and I 
shall do this at the outset of my dis- 
course. 

Doctrines of Ricardo and Malthus. 

The two fundamental doctrines — 
so-called principles— of the prevailing 
system of Political Economy are Ri- 
cardo’s Theory of Rent and Malthus’s 
Law of Population. The first of these 
is, briefly, that it is the best soils which 
are occupied first ; and that when only 
those of the first quality are occupied, 
no rent is paid, but as population in- 
creases, and the soils of second quality 
are brought under cultivation, rent is 
paid on the first, and so on, through 
all the different grades, rent steadily 
increasing on those soils previously 
occupied as men are driven to the cul- 
tivation of those of inferior quality. 
Thus does the owner of the land re- 
ceive a steadily growing proportion 




3 


of a smaller yield— the condition of 
the tenant thereby becoming one of 
more and more complete slavery. 

Carey’s Law of the Occupation of 
the Earth. 

The trouble about Ricardo’s theory 
is that the history of the settlement of 
the earth from the earliest ages is en- 
tirely at variance with it. When 
brought to the crucial test of facts, it 
utterly breaks down. Man has always 
and of necessity must commence the 
work of cultivation upon the light 
soils, mainly on the hills, and only as 
population and wealth increase is it 
that he has been enabled to come down 
on to the strong and heavily-timbered 
soils, or to the swamps in the valleys 
enriched by the washings from the 
hills through the countless ages. 

Tracing out the history of the hu- 
man race from its cradle on the slopes 
of the Himalayas, through Afghanis- 
tan, Persia, and Egypt, with the oc- 
cupation of the upper Nile, and with 
Thebes as its first great city, and as 
population and wealth increase Mem- 
phis becoming the capital, we find 
that the delta of the Nile eventually 
becomes reclaimed. Greece presents 
the same facts, the hills of Arcadia 
and the poor soils of Attica being 
settled before those richer ones of 
Ellis and Bceotia. In Italy it is the 
same — the Samnite Hills, Etruria, Y eii 
and Alba all being peopled before 
Rome was founded on the banks of 
the Tiber, and which was there placed 
upon her seven hills. France, Eng- 
land, and Scotland all go to enforce 
the same great truth— the most pow- 
erful tribes in Gaul, at the time of the 
Caesars being found on the Hanks of 
the Alps ; while in Cornwall there are 
indications of a cultivation of great 
antiquity, together with the ruins of 
Tintagle Castle, the seat of King Ar- 
thur. In the fens of Lincoln and 
Cambridge shires will be found the 
most recent lands in England reduced 
to cultivation, while in the Highlands 
of Scotland the first lands cultivated 
have been abandoned as too barren 
and poor to repay cultivation. 

Coming now to this continent, we 
find the first successful English settle- 
ment on the barren soil of Massachu- 
setts-some of the earliest settlements 
high up on the hills being now, by de- 
grees, abandoned. In New York the 
poor soil of Manhattan Island and the 
highlands on the opposite shores first 
claimed attention, while some of the 
richest still remain unreclaimed. In 
New Jersey the highlands at the heads 
of the rivers, or the light sandy soils 
near the Delaware, were first settled, 
while it is only within recent years 
that the effort has been made to re- 


claim the flats, between Newark and 
Jersey City. Pennsylvania tells the 
same story— the highlands immedi- 
ately west of Philadelphia having 
been settled and even cultivated in 
the time of William Penn, while the 
richest flats on the Delaware remain 
unreclaimed at the present hour. In 
Ohio the early settled lands are being 
abandoned, and in Indiana and Illi- 
nois the wet prairies are uncultivated 
and pestilential swamps unreclaimed 
to this day, while in Mexico, Peru, 
Brazil and every other part of both 
North and South America we find the 
proof of the universality of this law 
of the occupation of the earth, first 
given to the world by Carey. Not 
only is the doctrine true, but it must 
be so— man occupying that which he 
can subdue to his use ; always in the 
poor and weak condition of the early 
settler, the poor soil. He does not 
commit the aimless folly of occupying 
that which will subdue, and even 
through famine and pestilence, de- 
stroy him and his family. 

The facts and the deductions drawn 
from them as presented above are 
fatal not merely to Ricardo’s theory, 
but to the whole superstructure which 
has been built upon it ; John Stuart 
Mill assuring us that it is “the most 
important proposition in political 
economy,” and that “were the law 
different nearly all the phenomena of 
the production and distribution of 
wealth would be different.” 

The Law of Population. 

Let us now examine the other fun- 
damental law of the orthodox system, 
Malthus’s Law of Population. By 
virtue of this law, man has a tendency 
to increase in numbers more rapidly 
than food, and but for wars, pestilen- 
ces and famines, the world would be 
so thickly populated, that there w r ould 
be hardly standing room for us. Now, 
what are the facts ? What does com- 
parative physiology teach ? That the 
power of procreation, in all organic 
life, is in the inverse ratio of develop- 
ment ; in other words, of the power to 
maintain life — the lower forms pos- 
sessing it in a high degree, and the 
highest in a low degree. Even the 
power in man is not a constant quan- 
tity, but declines with the growth of 
his development. These facts are 
fatal to Malthus’s law ; and it will 
one of these days come to be regarded 
as among the most remarkable of the 
delusions of a past age. Here is an- 
other case where “ the law being dif- 
ferent, nearly all the phenomena of 
the production and distribution of 
wealth ” are different. These two 
foundation-stones of political econ- 
omy, contributed by Messrs. Ricardo 


4 


and Malthus, being disposed of, the 
whole system which is built upon them 
may logically be dismissed as a tissue 
of false assumptions. Indeed, Mr. 
Mill only claims that political econ- 
omy is a system of assumptions, he 
saying of it that it “ necessarily rea- 
sons from assumptions and not from 
facts.” Here is just the difficulty 
with all early attempts at what is 
called science, it being more conveni- 
ent to propound theories in the study, 
without an accumulation and an ex- 
amination of facts, many of which are 
inaccessible or inexplicable. Indeed, 
Mr. Mill gives as the reason for fol- 
lowing the a priori method that “it 
is vain to hope that truth can be ar- 
rived at while we look at the facts in 
the concrete, clothed in all the com- 
plexity with which nature has sur- 
rounded them, and endeavor to elicit 
a general law by a process of induc- 
tion from a comparison of details, 
there remains no other method.” 
These reasons would be quite as de- 
fensible in the chemist or the natural 
philosopher, and would result in dis- 
cords as great as those which obtain 
throughout political economy ; the 
teachers of which have rested con- 
tented with their own verdicts, which 
have not been tested by facts, the vice 
of the a priori method.* 

The Pennsylvania System of Social 
Science. 

How is it with the Pennsylvania 
system ? Has it been content with 
theories based on assumptions, or lias 
it examined facts and analyzed the 
movements of society, and from these 
developed laws ? It has given us the 
true law of the occupation of the 
earth, and that of population, both 
based upon the observation of facts, 
the law of value, which latter is not 
found in the cost of an article, but 
in that of reproduction, value being a 
measure of the resistance to be over- 
come in getting possession of the 
thing desired. Thus with all improve- 
ments in modes of production, exist- 
ing things decline in value compared 
with man, labor becomes more effi- 
cient; and a larger proportion of a 
larger product goes to labor, whose 
lot thereby becomes in all advancing 
communities a steadily improving 

* A recent American economist, a believer in Ri- 
cardo’s theory of rent, says of it, “The law is true 
only hypothetically, and the conditions assumed ex- 
ist nowhere.” So, too, is it in regard to the animal 
known as the economic man, Mr. Mill saying: “ Not 
that any political economist was ever so absurd as to 
suppose that mankind is really so constituted, but 
because this is the mode in which science must neces- 
sarily proceed.” Such is the orthodox system through- 
out, hypothetical and hence unreal, and not of, or for 
this world or its people ; hence has it proved to be 
one of the greatest of all the curses of the human 
race, savage as well as civilized. 


I one. This law of distribution is one 
which introduces both harmony and 
happiness into the future of the human 
race. 

Association. 

But the fundamental law of this 
system, the one which lies at the basis 
of all society, the most important con- 
dition governing man, still remains to 
be stated ; and is so self-evident that 
its statement alone is necessary to 
carry conviction as to its truth, and 
its far-reaching effects, to every can- 
did, unbiased and intelligent mind. 
“Man the molecule of society,” says 
Carey, “ is the subject of social science. 
Like all other animals, he requires food 
and sleep ; but his greatest need is 
that of association with his fellow- 
men. Born the most helpless of ani- 
mals, he requires the largest care in 
infancy. Capable of acquiring the 
highest degree of knowledge, he is yet 
destitute of the instinct of the bee, 
the beaver, and other animals. De- 
pendent for all his knowledge on the 
experience of himself or others, he 
needs language for the interchange 
of thought ; and there can be no lan- 
guage without association. Isolate 
him and he loses the power of speech, 
and with it the reasoning faculty ; re- 
store him to society, and with the re- 
turn of speech lie becomes again the 
reasoning man.” 

Here is the pivotal point, the con- 
trolling law of man’s existence, no 
one being sufficient unto himself ; and 
the further lie advances in culture and 
civilization the greater his dependence 
upon his fellow-men, this dependence 
being in fact at once a measure and a 
test of his civilization. In the early 
stages of society, and in isolated com- 
munities there is but little societary 
life ; and there man is dependent upon 
a comparatively few people ; while in 
a city like London, Paris, New York, 
or Philadelphia, there are many thou- 
sands of individuals, each of whom 
daily calls for the services of millions 
of men. Indeed, there are few persons 
here present who do not do this— the 
purchaser of a copy of the Herald , 
Tribune, or Sun , thereby calling for 
the services of the millions of men 
who have in any way contributed to 
the production of one of these papers, 
even so remotely as by making the 
materials of which the railroads or tele- 
graphs have been constructed— by 
means of which the raw materials and 
news have been conveyed— all the way 
through from the smelters of the 
metals, in the machinery used in its 
production, to the makers of the paper 
and the type, and to the compositors, 
pressmen, editors, etc. 

That there may be association there 
must be differences among those com- 


5 


posing a community, and the greater 
these differences the more instant 
the demand for labor power, the 
most perishable of all commodities, 
which must be consumed on the in- 
stant of its production, or it is lost 
forever. The measure and test of the 
power and wealth of any community 
or country is found in the proportion 
of its labor power which is not wasted 
— more being wasted in every country 
than is utilized. 

“ The more imperfect a being,” says 
Goethe, “ the more do its parts resem- 
ble each other, and the more do the 
parts resemble the whole. The more 
perfect a being, the more dissimilar 
are the parts. In the former case, 
the parts are more or less a repetition 
of the whole ; in the latter they are 
totally unlike the whole. The more 
the parts resemble each other, the less 
is the subordination of one to the other, 
subordination of parts indicating a 
high grade of organization.”' “Life 
being a mutual exchange of relations,” 
says Carey, “where difference does 
not exist, exchanges cannot take 
place; and the development of in- 
dividuality has ever been in the ratio 
of the power of man to combine with 
his fellow-men.” 

The Necessity for Diversified In- 
dustries. 

Just here and for these reasons, as 
may well be seen, comes in the im- 
perative necessity for diversified in- 
dustries, without which no country is 
now, nor has it ever been rich, because 
of its great waste of labor power ; and 
in exact proportion to this diversifica- 
tion of industries is a country rich, 
powerful, and independent. Let us 
not be diverted from the contempla- 
tion of this great fact by the mere dis- 
cussion of prices, which only befogs 
the case — an article bought abroad be- 
ing dear at any price, when the labor is 
being wasted at home , which could and 
would have produced it, had it not thus 
been bought. Tlius is it that agricul- 
ture caii only flourish where the plow, 
the loom, and the anvil work in har- 
mony the one with the others. .With- 
out consumers near the farm the pro- 
ductions of the latter must be limited 
to those few articles, such as wheat, 
corn, rye, cotton, tobacco, etc., which 
will bear transportation to a distance, 
and which are so exhausting to the soil, 
and made still more so by being con- 
sumed away from the farm ; thus, while 
the farmer is being ground under the 
tax of .transportation, there can be no 
proper rotation of crops, and the result 
to the soil in this country, and espe» 
cially in the South, is such that the 
Hon. Chas. J. Faulkner, of Virginia, 
felt constrained in 1858 to say : 


“During the past summer I heard an 
opinion expressed by Professor Henry, the 
distinguished Secretary of the Smithsonian 
Institute, which struck me at the moment 
as extravagant, but which a little reflection 
satisfied me was founded upon the strong 
probabilities of truth. It was that there 
was more wealth invested in our soil in fer- 
tilizing matter at the moment this continent 
was discovered by Columbus, than there is 
at present above the surface in improve- 
ments and all other investments. . . The 
fertility which ages had accumulated upon 
its surface has been the capital upon which 
the farmer has been drawing with reckless 
prodigality from the first settlement of the 
country.” 

Only with a diversification of em- 
ployments, and when the consumer is 
brought to the side of the producer, 
and the power of association thus be- 
comes great, and wealth increases, is it 
that the richer soils are brought under 
cultivation. When these industries 
decline, men are driven back from the 
richer to the poorer soils, as in India, 
Turkey, and Ireland ; and only in 
purely agricultural countries is it that 
famines take place. These really re- 
sult not from an absence of food, but 
from want of the means of procuring 
it. In 1847, during the famine in Ire- 
land, from which one million of peo- 
ple perished, Ireland was still a large 
exporter of food to England. That 
unhappy country is kept in a chronic 
state of pauperism, anarchy and bar- 
barism because of an absence of diver- 
sified industries, and of the power of 
association, which can come from 
them alone. 

The Part Played by Great Industries 
in the Social Economy. 

Every important industry existing 
in a country becomes incorporated 
into, and a part of the very marrow 
and texture of the societary life of that 
country; acting like a prime mover, 
or rather like a great heart, giving and 
receiving at every moment, at every 
pulsation, new invigorating and re- 
generating life and power. The ani- 
mal organism has but one heart, but 
the societary one may be said to have 
as many as there are important in- 
dustries in it ; and as these industries 
increase in number, these great hear f 
also increase in number, and p- 
gain in vigor they impart J 
to society, which is b”' 
for associatio> t - 
dustries are 
heart and the 
to the animal t 

So great, so 
reaching are th 
’effects of the pul. 
industrial hearts . 
oughly and comph 
follow up the ebb . 


f 


6 


to one of them, is beyond the power 
and capacity of the human'mind. Per- 
mit me, however, for a few moments 
to direct your attention, inadequately 
though it be, to some of these phe- 
nomena connected with a single in- 
dustry in giving motion and life to 
society. I refer to the American 
Bessemer steel rail manufac- 
^ ture, at once the crown and glory, 
and the practical vindication of the 
protective policy in the United States 
within the past decade and a half, 
and the true and unerring guide to 
national industrial legislation— Pro- 
fessors Perry and Sumner and those 
great statesmen in Congress, Messrs. 
Beck, Carlisle, Tucker, and Morgan to 
the contrary notwithstanding. 

The rail roller in a Bessemer rail mill , 
who receives the steel in order to heat 
it and put it through the rolls, re- 
ceives therefor wages which he ex- 
pends for fuel, food, clothing, shelter, 
etc. This expenditure gives vitality 
to the business of the butcher, the 
baker, the miller, the dry goods dealer, 
the coal dealer, etc., etc., and to the 
investment of the owner of real estate, 
and through these several persons to 
the farmer who raises cattle, sheep, 
wheat, rye, corn, vegetables, milk, 
butter, fruit, etc. ; to the coal operator 
and thence to his miners and laborers ; 
the raisers of horses and mules and 
the feed for these latter ; to railroads 
and other carriers, thence to the manu- 
facturers of cotton and woollen fabrics 
and their workmen, and the producers 
of raw cotton and wool ; the importers 
of tea, coffee, and sugar, and the re- 
finers of this latter; and from all of 
these back and through each other, in 
a ceaseless round of acts of associa- 
tion, the threads of the multitudinous 
ramifications of which it is as impos- 
sible to gather and trace as would be 
an attempt to count the sands on the 
seashore. 

Here I have merely attempted to 
indicate the direction in which we 
may look in order to analyze these 
movements, and nothing more ; be- 
ginning and ending with the roller of 
rails, not attempting to go through the 
same process with the owner of the 
Bessemer works; the men who have 
made the steel itself ; the bricklayers, 
carpenters, iron and steel workers, 
laborers, etc., who have built these 
works ; the lumbermen and brick- 
makers who have furnished materials : 
the manufacturers who have produced 
the pig iron, the miners and quarry- 
, men who have furnished the iron, 

coal and limestone ; the transporters 
^ o < <£f all these materials, and countless 
s^^tjiers who have more or less labored 
r © mind and body to start and keep 

** ^^^^tootion this great industry, and 


^others on which 


it has drawn, 




and the other millions of men, women 
and children who have in one way or 
another ministered to their wants. 

The Entire Cost of Such Rails 

as these is but a utilization of labor 
which would have gone to waste or of 
raw materials which would have had 
no value but for this industry — coal, 
for instance, in the ground on an un- 
developed tract not being worth one 
cent a ton. The commerce which is 
set in motion by such an industry is in 
the aggregate many times as large as 
its own volume, thereby assisting mil- 
lions of men in the work of complying 
with the paramount and controlling 
condition of their nature and upon 
which their prosperity, civilization 
and happiness depend, — that of associ- 
ation,— exchanging commodities, ser- 
vices and ideas with their fellow-men. 
Transfer the present demand for this 
commodity to Great Britain and to it 
also is transferred the power of associ- 
ation which accompanies it, involving 
thereby a decline in the demand for 
American services, commodities and 
ideas, and of national wealth and 
power. 

This analysis, inadequate though it 
be, in showing the wide dissemination 
of the vitalizing influences which flow 
from a magnificent industry such as 
this, at least exposes the utter absurdity 
of the narrow, fallacious and malig- 
nant attacks of the free foreign trader 
when he treats such industries wholly 
and solely as means of enriching the 
heads of the concerns, and them only. 
A practical illustration of how general 
is the benefit which flows from such 
industries, how thorough the solidarity 
of great interests, is found in the fact 
that the whole of the last annual divi- 
dends of the Pennsylvania Railroad 
Company— of $6,890,000 — are more 
than represented in the sums paid to 
that company by four Bessemer steel 
and iron manufacturing works on the 
line of the road, for freights. 

Professor Perry on the Effects of Duty 
on the Price of the Domestic Product. 

But just here Prof. Arthur Latham 
Perry, of Williams College, steps in to 
disturb my serenity by a private letter, 
written, however, on my own urgent 
application, and with the express un- 
derstanding that its statements were 
to be used by me on this occasion. In 
it he says : 

“ Calling the entire sale of Bessemer steel 
rails in 1881 twenty parts, more than nine- 
teen parts were domestic made. A little less 
than one part was foreign made, on which 
the Government received in duties about 
$1,200,000. The tariff tax of $28 a ton, put 
on for that very purpose, as you know very 
well, raised the price of domestic rails on 


7 


the average of that year $25 a ton. Multiply 
the number of tons of home rails sold that 
year by twenty-five/’ adds Prof. Perry, “ and 
you have in dollars nineteen times the sum 
which the Government got on steel rails. I 
have the exact amounts from official sources 
of the imported rails and the duties on them, 
the amount of home rails sold, and the prices 
of them from the best authorities, and the 
figures of the argument given above are now 
in the printer’s hands in Boston and will ap- 
pear in the eighteenth edition of my . larger 
book on Political Economy in the spring. 
On coarse blankets that year the Govern- 
ment got $1,058 in duties, the people paid 
more than a thousand times that sum in the 
artificial prices of blankets caused by the 
tariff tax. I am prepared to demonstrate 
that the people have paid more than $600,- 
000,000 a year on the average of the past 
twenty years in direct consequence of pro- 
tective tariff taxes, not one penny of which 
went to Government.” * 

This is the same old economic Joe 
Miller which is referred to by the Lite 
Hon. Andrew Stewart, of Pennsyl- 
vania, as follows : 

“In the debates of 1844-46 it was shown 
that in 1816 there was a duty of about seven 
cents a square yard imposed on cotton goods, 
then selling at twenty-five and thirty cents 
per yard, by a bill reported by Mr. Lowndes 
and advocated by Mr. Calhoun, of South 
Carolina, and that afterwards a duty of $4 
per box was put on glass, three and a half 
cents per pound on nails, etc., which at the 
time of the debate appeared to be selling, 
cotton for six cents a yard, glass at $3.50 a 
box, nails at three and a quarter cents a 
pound, etc. Yet it was still contended, then 
as now, that the duty was added to the price 
and paid by the consumer. That is, that the 
consumer who bought a yard of domestic 
cotton for six cents paid seven cents duty; 
on a box of glass he bought for $3.50 he paid 
$4 duty ; on a pound of nails he bought for 
three and a quarter cents he paid a duty of 
three and a half cents. These facts were not 
denied, but the theory had to be maintained 
that the duty was added to the price, or all 
their speeches about taxation, oppression, 
etc., would have vanished into air.” 

The charm of this doctrine of Prof. 
Perry and his school lies in the fact 
that the more nearly complete the inde- 


* Prof. W. O. Sumner, of Yale College, has, under 
date of February 26th, 1883, given in his adhesion to 
the same doctrine in the following most remarkable 
propositions : 

“ The statistics of pig-iron are: Capital, $105,000,000; 
hands employed, 41,700 ; wages, $12,000,000 (average, 
$1 per day); produced, 3,700,000 tons; value of all 
products, $<-9, 000, 000; materials used, $58,000,000; 
product raised in value, $31,000,000. 

“The imports in 1880 were 600,000 tons; tax, $7 
per ton; revenue, $1,200,000; tax paid to the home 
producers. $25,900,000 ($7 per ton on 3,700,000 tons). 
If we had paid full wages and ten per cent, profits to 
all persons interested in pig-iron to hire them to be 
idle, but let us get 3,700,000 tons of pig-iron in a 
free market, the account would have stood thus : 

Gain $25,900,000 

boss — wages $12,600,000 

Ten per cent, on capital 10,500,000 

1 oq i pa nnn 


pendence of the country becomes in 
any department of industry, on the 
like products of which a duty on im- 
ports is levied and consequently the 
less proportionate quantity we import, 
the more crushing the character of the 
bill of indictment the professor is able 
to bring against the American pro- 
ducer of the article, for levying a tax 
upon the consumer by means of im- 
port duties, the equal of which are 
said to be piled upon the whole Amer- 
ican product. Indeed , the ratio of the 
magnitude of the Perryian charge of tax 
extortion, compared with duty actually 
collected by the Government , is the pre- 
cise measure and test of the development 
of an industry in this country. 

For instance, the price of' American 
Bessemer rails having been so high in 
1881 that only 1,187,770 out of 1,410,367 
tons or {j— not $#,’as stated by Prof. 
Perry — were of domestic manufacture, 
under the theory the American man- 
ufacturer only levied $5 tax upon his 
victims to $1 collected by Government, 
instead of $19 to $1, as stated by Prof. 
Perry ; and a less amount absolutely. 
Had the price been only one-half what 
it was, and T 9 0 9 o keen of domestic man- 
ufacture, why, of course, under the 
professor’s logic, the American robber 
would have extorted a tax of $25 or 
$28 a ton on say 1,396,000 tons, instead 
of on 1,187,770 tons, even though the 
price were but $30.57 per ton, leaving 
only $2.57 to $5.57 as the legitimate and 
honest price of a ton of Bessemer rails ! 

The Farmer as an Extortioner. 

But practically the greatest extor- 
tioner in the land under this theory, 
with the present protective tariff, is 
the farmer, who has made us more in- 
dependent of the rest of the world 
than any other American producer, 
and for this very reason , and who for 
the crops of 188i levied taxes upon his 
poor and unfortunate victims as in 
the table ( See page 8.) 

Here is extortion for you ! Only 
$1,780,000 of duties collected by the 
Government, and $264,000,000, or one 
hundred and fifty-five times as much 
taxation; levied upon the people by 
the farmer ! Had I selected the crops 
of these products in 1880, which were 
nearly one-third larger, although they 
produced $128,000,000 less, absurd as it 
may appear, I should have been able, 
by following the logic of Prof. Perry, 
to have shown an extortion of $88,- 
000,000 greater ! 

American Blankets. 

Prof. Perry makes a strong case 
against the American producer of 
blankets, but this is readily explained 
when you remember that my very able 
friend, Prof. Henslow, of Chicago, ex- 


Net gain 


$2,SU0,0U0 


8 


hibited to you here some weeks ago 
an English and an American blanket, 


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the former invoiced at seventy nine 
cents a pound in England and the 
latter, quite equal in quality, worth 
seventy-eight cents in Chicago. Thus 
is it that having so nearly achieved in- 
dustrial independence in the article of 
blankets that Prof. Perry is enabled to 
figure out a tax on the consumer of 
$1,058,000, while the Government only 
got $1,058 in duties. Had the price of 
American blankets been double what it 
was , and the domestic supply but one- 
tenth , the extortion would have been but 
one-tenth. This glorious muddle, by 
virtue of which the cheaper a domestic 
product and the more it is enabled to 
drive out the foreign the greater the 
extortion, is indeed a profound prin- 
ciple of social philosophy, and one 
which is deservedly made the guiding 
star of the Becks, the Coxes, the Mor- 
risons, the McKenzies, the Kassons 
and the other great American states- 
men who, by means of this light, be- 
come so eminently qualified to direct 
the destinies of a nation of over 50,- 
000,000 of people. 


Professor Perry’s Necessary Assump- 
tions. 

But let us subject the statements of 
Prof. Perry to a closer and more crit- 
ical examination, and see whether his 
conclusions are not founded on pre- 
mises which are insufficient — whether 
there are not great and essential factors 


\ 


in them which are wholly ignored ; in- 
deed, if he has not really been prac- 
tising a little of that assumption of 
Mr. Mill, which has so long made 
political economy an intellectual quag- 
mire, utterly repulsive to the vast 
majority of cultivated minds ? 

In these statements, there is an 
assumption : 

First. Either that without protective 
duties on Bessemer steel rails the 
American production would have been 
the same that it now is, or, 

Second. That with a constant or a 
decreased supply and an increased de- 
mand there would have been no ad- 
vance in price ; or, 

Third. That if dependent upon Brit- 
ish production for the principal part, 
or even for the whole of the British 
and American demand, — the latter 
greater than the whole British produc- 
tion— and the other outside demand 
on Great Britain, the price there 
would not have been advanced be- 
yond what it actually was in 1881 : or, 
Fourth, and finally. That in the 
absence of these protective duties and 
those on other products entering into 
competition with American produc- 
tions, American industrial and socie- 
tary vitality would have been at so 
low an ebb, so near unto death’s door, 
that the demand for Bessemer rails 
in this country would have been so 
small as to have kept down the price 
in the face of a decreased production. 

There is positively no escape for 
Professor Perry from one or more of 
these dilemmas ; the attempt to figure 
out an aggregate of taxation upon 
American consumers by taking as the 
sole elements for determining this 
taxation the amount of American 
production and the rate of duty upon 
corresponding foreign products, being 
incomplete and therefore illogical 
without assuming one or more of the 
foregoing conditions. 

America’s Production, Importation, 
and Consumption of Pig Iron, with 
Prices. 

To test the force of these essential 
factors in the argument, which Profes- 
sor Perry has wholly ignored, I pro- 
pose to make use of the important 
Table on page 9. 

This period commences with 1841-42, 
the close of the revenue “compromise 
tariff act ” of 1833, under which with 
the duty on pig iron on June 30th, 
1842, $3.16 per ton, the country had 
reached the lowest depths of bank- 
ruptcy and despair ; the whole period 
of the protective tariff of 1842, with 
the duty at $9 per ton ; and nearly the 
whole period of the revenue tariff of 
1846, which closed June 30th, 1857, 
with the duty at 30 per cent, ad va- 
lorem. 


9 


Table showing the American production , the 
prices in New York , the imports and 
total consumption , and consumption of 
pounds per capita of Pig Iron , with the 
population of the United States, annu- 
ally from 1841 to 1856 inclusive: 


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500000 


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5 


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500000000 


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3 


steadily and marvellously increased, 
while under the revenue tariff of 1846, 
until 1852 inclusive, it declined •, and 
that from 1853 to 1856, the whole sup- 
ply, domestic and foreign, was as fol- 
lows : 

1853, 780.894 tons. I 1855, 799,084 tons. 

1854, 817,822 “ | 1856, 847,527 “ 

or less in the last named year than it 
was in 1848. Railroad building having 
received a large impulse from the 
emigration of the people to the West, 
and a demand arising, the average of 
the prices in New York for these four 
years, 1853-56 inclusive, under the 
revenue tariff of 1846, was $34.28 
against $28.19 for the four years 1843- 
46 inclusive, under protection, the 
$6.09 difference being part of the ex- 
pense at which our British competi- 
tors were, and which they charged us 
for destroying our iron industry— half 
the iron-works in the country having 
been sold by the sheriff in 1849-52. 

Fourth assumption. Finally, that 
in the absence of these protective 
duties, and those on other products 
entering into competition with Amer- 
can productions, American industrial 
and societary vitality would have been 
at so low an ebb that the demand for 
Bessemer rails would have been so 
small as to have kept down the price 
even in the face of a decreased pro- 
duction. 


The Assumptions Examined. 

Let me then take up each of the as- 
sumptions, the missing factors, in the 
order in which I have named them, 
and apply to them the facts given in 
the foregoing table as follows : 

First assumption. That without 
protection the American production 
of Bessemer rails would have been 
the same. 

Under the protective tariff of 1842 
we see the production of pig iron rise 
steadily from 230,000 tons in 1842 to 
765,000 tons in 1846, the last year of 
the tariff of 1842; while under the 
revenue tariff of 1846, but still under 
the momentum derived from protec- 
tion, it goes to 800,000 tons in 1847 
and 1848, to fall, however, to 650,000 
tons in 1849, 564,755 in 1850, 532,378 in 
1851, 500,000 in 1852, and finally only 
reach 788,515 in 1856 ; but 3 per cent, 
above what it was in 1846, while the 
population had increased more than 
35 per cent. 

Second and third assumptions. That 
with a constant or a decreased supply, 
and an increased demand, there would 
have been no advance in price, or that 
if dependent upon British production 
the price in Great Britain would not 
have been advanced beyond what it 
actually was in 1881. 

Under the tariff of 1842, as we have 
seen, the supply of American pig iron 


How Free Foreign Trade Reduced 

Consumption, and ran up Prices. 

Well, for the years 1848 to 1852 in- 
clusive, national free foreign trade 
asphyxia did keep down the price of 
pig iron in despite of a decreased sup- 
ply and with an increased popula- 
tion ; for while in 1848 we find the 
total supply, foreign and domestic, 
851,632 tons, and the population 21,- 
805,000, or 87.5 lbs. per capita, the 
price in New York was $29.31, in 
1852 the supply was but 591,874 tons, 
and the population 24,802,000, or but 
53.5 lbs. per capita, the price was but 
$22.23. However, while the consump- 
tion never in 1853-6, went beyond 69.3 
lbs. per capita, which was reached in 
1854, against 87.7 lbs. in 1847, the 
price ran as high as $38.56, being 
$5.94 per ton more than was reached 
in 1845, the highest year under the 
protective tariff of 1842. So even 
national free foreign trade asphyxia, 
which had succeeded in reducing the 
power of the country to consume pig 
iron by 20 percent, per capita, did not 
succeed in keeping down the price. 
This lamentable fact was owing to 
the impulse which the gold of Califor- 
nia gave to business throughout the 
world. But for this the consumption 
might have been kept down to 50 or 
53 lbs. per head, and the price have 


10 


remained where it was in 1850 ; and 
here would have been a hook on 
which to hang this profound principle 
of free foreign trade political econ- 
omy. 

In 1881 the American production 
alone of pig iron was 4,144,250 gross 
tons, equal to 180 lbs. per capita of 
the population, or more than twice 
the domestic and foreign supply com- 
bined during any year of the existence 
of the revenue tariff of 1846 ; and 
nearly three times the average of six 
years of it,. 1851 to 1856 inclusive. 

The Bessemer Rail Industry. 

But it may be said that these facts 
have only reference to pig iron, and 
not to Bessemer rails. The magnifi- 
cent American Bessemer rail indus- 
try, the practical exemplification of 
the beneficence of the protective policy 
in this country, of which it is a child, 
and which has as we have seen been 
traduced by an advocate of free for- 
eign trade ideas, never having been 
exposed to the chilling blasts of that 
monstrous philosophy in practice, it 
is impossible to institute a compari- 
son between its respective rates of 
growth under the two systems. It 
should, however, be enough to show 
that in the seventeen years, 1866 to 
1882 inclusive, it has grown from 
nothing to the grand dimensions here 
given, as follows : 

Table of the statistics of the annual pro- 
duction of steel rails in the United 
States, since the commencement of their 
manufacture, together with the annual 
average price at which they have been 
sold in the works in Pennsylvania, and 
the rate of duties imposed on foreign 
rails. 


Years. 

Product 
in Gross 
Tons. 

Price in 
Cur- 
rency. 


Duty. 

i«f>7 

2,277 

6,451 

$166 00 


45 per 

1808 

158 50 


cent. 

1869 

8,616 

132 25 


ad va- 

1870 

30,357 

106 75 


lorem. 

1871... 

34,152 

102 50 


$28 

*1872 

83,991 

112 00 


per ton 

*1S73 

115,192 

120 50 


to 

1874 

129,414 

94 25 


Aug. 1, 

1875 

259,699 

68 75 


1872; 

1876 

368,269 

59 25 


$25.20 

1877 

385,865 

45 50 


to 

1878 

491,427 

42 25 


Mar. 3, 

flS79 

610,682 

48 33 


1875; 

tlS80 

852,196 

67 50 


$28 

f 1881 

1,187,770 

61 13 


from 

1882 

1,194,800 

48 67 


that 

date. 


To this may be added the following- 
table of the production of Bessemer 
steel rails in the United States and 


* These were the years of railvray fever and iron 
famine. 

f These were the years of a new railway fever, and 
of the boom in the iron trade. 


Great Britain in 1880 and 1881, in 
gross tons. 


Countries. 

1880. 

1881. 

Increase. 

TTnit.ed States 

Tons. 

852,196 

739,910 

Tons. 

1,187,770 

1,023,740 

Tons. 

335,574 

283,830 

Great. Britain 

Excess of U. S. over 
Great Britain 

112,286 

164,030 

51,744 


These two exhibits demonstrate that, 
not only have we reduced the price 
of Bessemer rails from $166 a ton in 
1867, at which time they were far 
cheaper, their wearing capacity con- 
sidered, than iron rails at their then 
current price ($83.12), but that we in 
1880 passed our old industrial enemy 
in this great industry and even indeed 
widened the breach between us and 
her in the following year. 

If we cannot institute a comparison 
between the condition of the Bessemer 
rail industry under free foreign trade, 
and under protection, under which 
latter policy it has wholly grown up, 
we can at all events make a compari- 
son between the prices of these rails 
under protection and of those of iron 
under free foreign trade. 

We have seen that the prices of 
Bessemer rails for the past five years, 
with a duty of $28 per ton, w r ere as 
follows : 


1878 $42.25 

1879 ... f Years of a new) .. . 48.33 

1880 ... ■< railway fever L. . 67.50 

1881 ( and boom in iron J .. . 61.13 

1882 48.67 

Or an average of 53.58 


While in the closing five years of 
the revenue tariff of 1846, with a duty 
of 30 per cent., the prices of iron rails 
at the mills in eastern Pennsylvania 
were as follows : 


1853 $77.25 

1854 80.12 

1855 62.87 

1856 64.38 

1857 64.25 

Or an average of 69.77 


Or $16.19 per ton more than the aver- 
age price of Bessemer rails for the 
past five years. But as the enduring 
qualities of iron rails are only one-fifth 
those of steel rails, this sum of $69.77 
should properly be multiplied by five, 
which would bring these rails, as com- 
pared in force or power with Bessemer 
rails to $348.85 per ton, with Bessemer 
at $53.58. 

What, then, becomes of Professor 
Perry’s charge of extortion against 
the Bessemer rail manufacturer ? It 
can no more stand confrontation with 


11 


the facts than it can the application 
of the legitimate processes of reason- 
i ng. The true way of comparing price 
with price is in connection with the 
force given by the respective things 
thus compared. The Bessemer in- 
dustry is the result of the protective 
duties under which it lias alone been 
built up, and for the last five years it 
lias given to society in this country 6.5 
times the force and endurance in the 
railway rail for the same money which 
icas given under the free foreign trade 
policy of 1846-61. It will not do to 
object that this comes from the de- 
velopment of science and art. These 
only flourish in lands of diversified in- 
dustries, where the consumer and 
producer are brought together, where 
the power of association is great, and 
man advances in civilization, and ob- 
tains control over the gratuitous forces 
of nature.* 

The prices of things depend upon 
the cost of reproduction and upon the 
volume of products compared with 
demand; and this volume of product 
is itself stimulated or depressed by 
the relation of the prices obtained to 
the cost of reproduction— an absence 
of remunerative demand causing 
sooner or later a decline in the vol- 
ume of production. 

Effect of Production on Prices. 

The influence of the volume of pro- 
duction on prices was never more 
strikingly illustrated than in the fol- 
lowing letter from Mr. J. It. Dodge, 
Statistician of the Department of 
Agriculture, to the Hon. Geo. B. 
Loring, Commissioner of Agriculture, 
in response to a letter of my own in 
January last : 


* But the question has been asked, how many tons 
of these rails were exported ? Only a trifling amount, 
and herein lies the crowning beneficence of this in- 
dustry, that its product was consumed at home. 

“ Between the production of any commodity what- 
soever, and its consumption, ’’ says E. Peshine Smith, 
“the interval, long or short, is one of inertness. It 
stands the monument of human power and natural 
forces which, having expended themselves in bring- 
ing it into shape, slumber in suspended animation, 
communicating no impulse to the incessant activity 
which, from the vegetable to the social order, is the 
essential characteristic of vitality : but is itself a clog 
and obstruction involving a draft upon the vital force 
to put it in motion. It is like an inorganic body con- 
tained in and afflicting an organism. The space to 
overcome, and the time to intervene before it evolves 
utility by its consumption, becoming then an instru- 
ment and a force, are co-efficients of its value, neu- 
tralizing in the same proportion the power of the 
community in which it rests paralyzed. The growth 
of wealth, therefore, depends upon the rapidity of 
circulat on ; not the rapidity with which products are 
transported in spiice, nor the frequency of mere 
changes of ownership, but the continuity of transfor- 
mations through the immediate succession of actual 
consumption to production.’* 

If the poor people of Great Britain possessed a 
p ower of consumption per capita equal to that of the 
people of this country, her exports of manufactured 
goods would not figure so grandly in tables of sta- 
tistics, but her people would he tar more t.appy, far 
more free, and her civilization would be far higher. 


U. S. Department oe Agriculture, 
Division of Statistics. 

Washington, January nth, 1883. 

Sir : The request of Mr. Henry C. Baird 
for comparison of products and prices of 
cereals in 1880 and 1881, the former a year 
of great abundance, the latter the worst for 
production in recent times, affords opportu- 
nity for instructive comparison of the effect 
of production upon price. 

It will be seen that the crops which were 
comparative failures in 1881 produced more 
money than the large crops of 1S80. This 
is in part the legitimate result of increased 
value from relative scarcity, in accordance 
with the law of supply and demand, and to 
some extent the effect of speculation, of fore- 
stalling and “cornering,” for which the 
small stocks furnished temptation and op- 
portunity. 

The rise in corn was about sixty per cent., 
a greater difference than in the quantities. 
Unlike wheat, more than a third of which 
is exported, corn is little affected by foreign 
demand, as the maximum of exportation is 
only six per cent. The home demand there- 
fore rules in the price of this cereal. 

The crop of oats was an average one, the 
sole exception in cereals of the year. Why 
did the price advance from 36 to 46 cents? 
Simply because oats can be used inter- 
changeably with maize within certain limits. 
But it could not advance equally with that 
cereal, because its uses are not identical. 

Wheat comes under different conditions. 
It goes in with the product of Europe, 
India, Egypt, and the shortage of the grand 
aggregate governs the price rather than the 
shortage in this country. It has happened 
that a very large crop has brought a large 
price per bushel, and a small crop a medium 
price. In one case the surplus of this coun- 
try was all wanted to supply heavy deficien- 
cies elsewhere ; in the other, a smaller sur- 
plus was in less demand abroad. And this 
apparent anomaly was thus strictly and 
truly the natural result of the commercial 
law of demand. 

The following table gives quantities and 
values, the prices being the average for the 
United States of the crop in the hands of 
farmers on the first day of December : 


1880. 


Crops. 

Bushels. 

Value. 

Price per 
Bushel. 

Corn 

1,717,434,543 

$679,714,499 

$0 39.6— 

Wheat 

498,549,868 

474,201,850 

95 1 + 

Oat< 

417,885,380 

150,243,565 

36. — 

Burley 

45,165,346 

30,090,742 

66.6+ 

Rye 

21,540,829 

18,564,560 

75.6+ 

Buckwheat. 

14,617,535 

8,682,488 

59.4— 

Potatoes 

167,659,570 

81,062,214 

48.3+ 

Total 

2,885,853.071 

$1 ,442,559,918 



1881. 


Crops. 

Bushels. 

Value. 

Price per 
Bushel. 

Corn 

1,194,916,000 

$759,482,170 

g0 63.6— 

Wheat 

383,280,090 

456.880,427 

1 19.3+ 

Oats 

416,481,000 

193,198,970 

46.4— 

Barley 

41,161,330 

33,862,513 

82.3— 

Bye 

20,704,950 

19,327.415 

93.3 + 

Buckwheat. 

9,486,200 

8,205,705 

86.5 + 

Potatoes 

109,145,494 

99,291,341 

90.9— 

Total 

2,175,175,064 

$1,570,248,541 





12 


A study of quantities and prices of the 
past ten years, on the basis of the estimates 
of this department, will afford much infor- 
mation concerning the fluctuations of pro- 
duction and resultant changes in values, 
and incidentally present very strong evi- 
dence of the substantial accuracy of the 
estimates,, showing very conclusively also 
the absolute necessity of annual statistics 
of production. Respectfully, 

J. R. Dodge, 
Statistician. 

Hon. Geo. B. Losing. 


Professor Perry Answered. 

To me it seems that the facts and 
the reasoning which I have presented 
against the doctrine of Professor 
Perry and his school regarding prices 
are conclusive, and that this letter in 
regard to the seven crops named 
settles the question beyond dispute. 
Not merely have I shown stimulation 
of domestic production to be an ac- 
companiment of protection, and that 
it keeps down price, in the face of a 
great increase in the power of con- 
sumption, but that this domestic pro- 
duction is largely destroyed under 
free foreign trade, and is not compen- 
sated for by foreign supply, when even 
with a great decline in the power of 
consumption, prices advance beyond 
what they were under protection.* 
Further I have accounted for these 
phenomena by the statement of the 
quantities and values of the great 
food crops of the United States; those 
of 1881, which were 25 per cent, less in 
quantity, producing 8 per cent, more 
money than the larger ones of 1880. 
So great is the influence of supply on 
price, that had we never established 
the Bessemer rail industry, which we 
would not have done without protec- 
tion, but depended wholly on Great 
Britain for our supply, even though 
our pow r er of consumption had been 
far less, the price would have unques- 
tionably been greater, indeed it is 
quite probable on the principles de- 
veloped by the facts shown in regard 
to the quantities and prices of the 


* The power of domestic competition alone to pro- 
tect consumers from extortion, and the utter ab- 
sence of any necessity for foreign competition in any 
industry for which we have an aptitude, is shown in 
newspapers and photographic portraits; which by 
their very natures require to be produced, not only 
at home, but near where the consumer lives, and 
which thus enjoy not merely protection but prohibi- 
tion. In these two departments of industry, not- 
withstanding the Associated Press monopoly — in no 
other country in the world is the public better or 
more cheaply served. Indeed the state of these two 
industries, compared with others which have foreign 
competition, goes far to prove that the effects of for- 
eign competition, so far from benefiting the con- 
sumer, by destroying industries, do him real harm 
by breaking up the steadier and more healthy com- 
petition at home, a competition which makes a de- 
mand for services, commodities and ideas almost 
wholly American, thus increasing the home market 
for these services, commodities and ideas. 


American food crops of 1880 and 1881, 
that the British product of steel rails 
had it, in 1881, reached even 1,500,000 
tons, would under such circumstances 
have produced a larger aggregate sum 
of money than the combined British 
and American product of 2,211,510 
tons for that year. I have also de- 
monstrated the narrowness and the 
total insufficiency of Professor Perry’s 
premises, by reason of liis ignoring 
these great and vital factors, and 
therefore the fallacious nature of his 
conclusions, which thereby become 
utterly unworthy of a moment’s con- 
sideration, even on the part of the 
merest tyro in the necessary processes 
of reasoning. 

Breakdown of the Free Foreign Trade 
Case. 

Nay, more, the entire free foreign 
trade case, as I have shown, breaks 
down on the question of prices — the 
only claim it presents for our accept- 
ance. A cause which wholly ignores 
the ruin of productive industries, for 
the sake of cheapness, and after the 
ruin is accomplished, can neither 
show prices so low as before, nor an 
equal supply, nor an equal power of 
consumption, is unworthy of the ac- 
ceptance of any rational man, unless 
he be an enemy of the country or the 
foreigner who is receiving this in- 
creased price in the face of decreased 
demand. 


The British Idea of Cheapness. 

But high prices are not necessarily 
and always an unmixed evil. Every 
period of great prosperity in our 
history has been accompanied by high 
prices, especially of land, labor, and 
raw materials. Those who are in re- 
ceipt of high remuneration for ser- 
vices and commodities, in turn make 
a large market for the services and 
commodities of others. The idea of 
cheapness which runs throughout 
British thought, and controls British 
legislation, and depresses, degrades, 
and brutalizes the great body of the 
people, is not merely wicked, but 
stupid ; for it works a damage to 
British industries by limiting the 
volume of the home market ; the con- 
sumption of the products of which 
industries would make the mass of 
people at home comfortable, happy, 
and civilized, thus alike blessing him 
that gives, and him that takes. Cob- 
den in his campaigns for the repeal of 
the Corn Lav/s, held up to the covet- 
ing eyes of his poor auditors, the idea 
of “ the big loaf,” as a grand result to 
flow from the free importation of 
foreign corn, thus ignoring the fact 


13 


that large bodies of English, Scotch, 
and Irish laborers were virtual co- 
partners in British agriculture ; and 
were certain to be injured by a policy 
which would throw vast tracts of land 
out of cultivation in corn and into 
permanent pasture, in which few 
hands are needed. This British fetich, 
cheapness, begins in injustice to the 
great mass of the people at home, and 
ends in wars, robberies, opium dealing, 
and famines abroad, resulting from 
the efforts to obtain additional mar- 
kets and revenues which should be 
had among its own prosperous, well 
paid, and happy people, and which 
would add to the power as well as to 
the glory of the empire ; for from the 
mass of the people really comes the 
national force. 

The Rational and Philosophical Road 
to Cheapness. 

But there is a real, true, beneficent 
and civilizing road to cheapness. It 
is found in a diversification of em- 
ployments, the strengthening of the 
power of the people by means of active 
association, the intelligence which 
flows from this association, and leads 
to the highest conquests over the 
forces of nature ; and of their utiliza- 
tion in propelling machinery and pro- 
ducing mechanical and chemical 
changes in the forms of matter. 
Thus, and thus only, do raw materials, 
including land and labor, tend to rise, 
because they thereby find new utiliza- 
tion ; and finished commodities to fall, 
because of the readiness with which 
they are converted into finished forms, 
by the aid of chemical reactions, and 
by machinery, propelled by water, 
heat, steam, gas, and electricity. 
Thus, and thus only does man become 
free. The power obtained in the 
harnessing of natural forces into the 
uses of man, will be made clearly ap- 
parent when it is considered that 
three tons of coal represent the labor 
power of a man for his lifetime. But 
when applied to improved machinery 
of great velocity, working with but 
little friction, this power is at times, 
by actual computation, multiplied as 
much as five-fold; in other words 
three tons of coal then representing 
the labor power of jive men for their 
entire lives. In the city of Philadel- 
phia for instance, there is a cotton 
mill, and not one of enormous size, 
which in 1877 manufactured in every 
day of ten hours 40,000 miles of cotton- 
yarn, obtaining from eight tons of 
coal dust the necessary power. Sup- 
posing it possible for such a quality 
of yarn to be made by hand, it would 
require the labor of 85,000 women 
working for the same number of 
hours. In 1870 but 137,876 men, 


women, and children were employed 
in the productive industries of that 
city; the products of which were of 
the value of $334,852,458. Thus did 
this one cotton mill represent nearly 
two-thirds of the mere physical power 
of those persons who produced this 
great body of commodities. By actual 
computation from the work done by 
the mill in the month of February, 
1877, and the cost of that work, for 
human labor to have competed with 
it unaided by machinery, it would 
have been necessary for that labor to 
have worked for 461-100 of one cent per 
daif wages. 

With such increase of force and 
decline of cost of conversion in hu- 
man labor, we may calmly leave 
prices to regulate themselves by 
means of domestic competition, and 
the new improvements in machinery 
and the new knowledge of chemical 
reactions which are always, taking 
place in a society of high vitality. In 
such a society, the standard argu- 
ments of the average political econo- 
mist of the free foreign trade persua- 
sion about prices are only worthy of 
the proprietor of a shop where candy 
is sold by the stick and gingerbread 
by the single cake. The power which 
Great Britain gets from coal and ma- 
chinery is generally estimated as equal 
to that of 600,000,000 men, but from 
a calculation which I myself made a 
few years since, based upon authentic 
data as to the cotton spindles in that 
empire, I am well satisfied that it is 
at least equal to that of 2,500,000,000 
of men. 

The Artificial Nature of Civilized 
Society. 

But the free foreign trader objects 
to the imposition of duties on foreign 
merchandise, because it introduces an 
artificial element into society, and in- 
terferes with his inalienable right to 
buy where he can buy cheapest, and 
sell where he can sell dearest. The 
fact is, this is prima facie evidence in 
its favor*, because this man forms a 
part of an artificial society — one in 
which the very clothes, abodes, man- 
ners, customs, and modes of living 
and being are artificial. Indeed, if 
he is a man of any culture, his own 
countenance is artificial, being made 
up by his surroundings and the know- 
ledge which they have given him. 
The more cultivated and civilized this 
society, the more fully have the mem- 
bers of it departed from nature. The 
natural man is found in Africa, in 
Patagonia, and in a measure among 
our Indians. The free foreign trader 
will find his natural rights among 
such men as these, and among bears, 
wolves, and catamounts, if he has the 
strength and cunning necessary to 


14 


maintain them. There he will find no 
custom-houses, no police, no boards 
of health, no municipal government 
which will oblige him to lay down 
pavements for other men and their 
horses and vehicles to pass over, nor 
sewers, nor gas-pipes for the use of 
others, nor will lie be obliged to pay 
for the schooling of other people’s 
children, or be subject to the other 
restraints of civilized society ; but he 
will probably after a few hours, days, 
or weeks of this experience, conclude 
that the restraints and privileges of 
civilization are far preferable to the 
discomforts and dangers which accom- 
pany the untrammelled exercise of 
liis natural rights in the midst of 
nature’s wild domain ; and elect to 
become a law-abiding member of a 
society in which the prosperity and 
happiness of all are the guiding star. 

The Rights of American Producers. 

And when our free foreign trader 
comes to look more deeply into the 
nature of this society, he may even be 
disposed to abandon his views in favor 
of free foreign trade on the ground of 
mere justice to our producers. As it 
is off of, or from American produc- 
tion, that the whole people, producers 
and non-producers, live, so it must be 
on the shoulders of American pro- 
ducers that all national, State, and 
local taxation finally rests, unless we 
can transfer some of this taxation to 
foreigners who seek our markets, 
which are wholly the fruit of Ameri- 
can production. It would therefore 
be altogether subversive of the rights 
of these American producers to admit 
the products of foreigners, except upon 
the condition that they pay a rate of 
taxation equal to that paid by American 
producers— these latter having rights 
under their own government, which 
they entirely support, at least equal 
to those of foreigners. The only 
rational and proper basis for free- 
trade, is that wholly between our own 
people, and not between some of our 
own people and foreigners; and until 
every possible means are taken to cast 
off the existing shackles which hamper 
the trade between parties wholly 
American, that between Americans 
and foreigners must be asked to stand 
aside and wait its day of realization 
in the future, and in a new Utopia.* * 


* By some unaccountable oversight, the free for- 
eign trade philosopher has been permitted to assume 
a position which could alone belong to an ideal, ab- 
stract, unreal community or country; wholly unlike 
those concrete ones existing among civilized men. 
This assumption involves ignorance of the fact that 
civilized society is, of necessity, an artificial one, and 
that purely abstract arguments, which do not deign 
even to recognize that this society is not an nn taxed, 
one, are wholly unfitted to its conditions, and therefore 
inapplicable to it, and unsound and fallacious when 
eo applied. Hence the unjustifiable nature of the pre- 


The Artificial Development of Nations 
and their Industries. 

In dealing with this society of ours, 
which we call the nation, we cannot 
too clearly, distinctly, and persistently 
bear in mind that it exists, one among 
many nations, each of which has more 
or less developed an artificial exist- 
ence, and not a single one of which 
has industries all of which bear per- 
fect and harmonious relations to each 
other ; that some one or more of these 
countries has one or many industries 
which we ourselves have, and which 
are developed to a greater extent than 
our own. Once more, we must re- 
member that association with his 
fellow-men is the first, the greatest, 
the paramount need of man ; that the 
more complete the diversification of 
employments, the greater this power 
of association, the greater the motion 
in society, the less the loss of labor- 
power, the greater the ability to sub- 
ject to the human will and use the 
forces of nature, the less the expendi- 
ture of human labor in converting 
raw materials into finished commodi- 
ties, the greater the power to com- 
mand an ample supply of money, the 
instrument of association, and the 
lower the rate of interest — the pre- 
cious metals travelling from those 
places where employments are not 
diversified and where the rate of in- 
terest is high, to where they are diversi- 
fied, and where the rate of interest is 
low. 

The artificial and inharmonious de- 
velopment of the industries of other 
nations calls, in turn, for artificial 
provisions against any movements of 
these industries in the direction of the 
destruction of the more or less happy 
balance of industries existing or try- 
ing to exist among ourselves— this 
balance being a measure of the power 
which we ourselves have actually de- 
veloped. These provisions are espe- 
cially essential the world over against 
the competing industries of Great 
Britain ; the well-recognized and even 
avowed selfish and wicked policy of 
which is industrial warfare, with a 
view to the centralization of wealth in 
the would be workshop of the world.* 


tense of this philosopher that he is a free trader. How 
can he be such, when he entirely ignores the fact that 
trade at home — the great trade — is not free and can- 
not be so, because of the overmastering necessity for 
taxation ; and that this taxation finally falls upon 
the producers, against whom his whole system is in- 
tended to be, and is, a persistently aggressive and 
even slanderous warfare ? In the paradise of free for- 
eign trade, England, it has recently been decided that 
a clergymen could not sell a small quantity of milk to 
one of his neighbors without first taking out a 
license; and yet there the most nearly universal 
object of worship is that of so-called “ free trade ! ” 

* IIow this is carried into practical effect is shown 
in the following passage from a Report made to Par- 
liament some years since by Mr. Tremenheere: — 
“The laboring classes generally in the manufac- 
turing districts of this country, and especially in the 


15 


These provisions against the destruc- 
tion of the harmonious balance of in- 
dustries are known under tlie name of 

Protection, 

a policy which not merely rests upon 
the foundations of justice, but which 
is vindicated by all history; whether 
that history be of England, France, 
Belgium, Russia, or the German Em- 
pire, t' } power of all of which has 
been 1 up by this policy, or of 
Ireland^ 'Turkey, Egypt, Portugal, 
India, Japan, or Jamaica, the power 
of which has been destroyed by the 
absence of it. It is vindicated at every 
step in our own history, from the 
settlement of the colonies to the pres- 
ent hour ; each period of free foreign 
trade having caused an impoverish- 
ment of the people, the colonies, the 
States or the nation, and each period 
of protection, after protection became 
possible by independence, having 
caused the rescue of both people 
and governments from wretchedness, 
bankruptcy and despair. 

The War of the Rebellion Due to Free 
Foreign Trade. 

Further, I here deliberately and dis- 
tinctly charge that every soldier who 
died of wounds , disease, or exposure , 
and every other man and every woman 
and child who died by reason of the late 
war of tlie rebellion, died a victim of the 
free foreign trade policy and more' par- 
ticularly of that of the tariffs of 1846 
and 1857. Had the policy of the tariff 
of 1842 been maintained continuously, 
there would have been no rebellion, 
for through diversification of employ- 
ments and the development of the 
mineral resources of the South, labor 
would have been elevated, land in- 
iron and coal districts, are very little aware of the 
extent to which they are often indebted for their 
being employed at all to the immense losses which 
their employers voluntarily incur in bad times, in 
order to destroy foreign competition, and to gain and 
keep possession of foreign markets. Authentic in- 
stances are well known of employers having in such 
times, carried on their w r orks at a loss amounting in 
the aggregate to £300,000 or £400,000 in the course of 
three or four years. If the efforts of those who en- 
courage the combinations to restrict the amount of 
labor and to produce strikes were to be successful for 
any length of time, the great accumulations of 
capital could no longer be made which enable a few 
of the most wealthy capitalists to overwhelm all 
foreign competition in times of great depression, and 
thus to clear the way for the whole trade to step 
in when prices revive, and to carry on a great business 
before foreign capital can again accumulate to»such 
an extent as to be able to establish a competition in 
prices w ith any chance of success. The large capitals 
of this country are the great instruments of warfare 
if the expression may be allowed against the com- 
peting capitals of f reign countries, and are the most 
essential instruments now remaining by which our 
manufacturing supremacy can be maintained; the 
other elements — cheap labor, abundance of raw r ma- 
terials, means of communication, and skilled labor — 
being rapidly in process of being equalized.” Report 
of the Commissioner, etc., in the Mining Districts, 
1854, p. 20. Lon., 1854. 

Further under a revenue system of duties on cotton 


creased in value* * and divided, f and 
slavery would have long since been in 
process of extinguishment ; this dis- 
ease being one which only fastens 
itself on communities of low vitality, 
that is, where there is no active power 
of association — its existence actually 
unerringly meaning this. The unde- 
veloped coal of the old State of Vir- 
ginia alone possesses a labor power 
exceeding that of all the slaves in the 
South in 1861, for hundreds of years. 
Further, I charge that the anarchy 
and ruin in the South after the close 
of the war were a result of the destruc- 
tion of the power of association, by 
the contraction of that best of cur- 
rencies, the greenback, when in 1865 
it should have been expanded, in order 
to provide for the great and pressing 
needs of the South. J 


goods of five per cent., quite a handsome industry has 
grown up at Calcutta; but the cotton manufacturers 
of Manchester never ceased their exertions until they 
prevailed upon the British Government to repeal 
these duties, not under pretense of benefiting the 
people of India, but for the aggrandizement of these 
manufacturers themselves. This was done in the 
face of the fact that the revenues were actually needed, 
and of the notorious poverty arid wretchedness of the 
people of India, w ho at times die of famine by mil- 
lions in a single year. 

* Land is valuable in proportion to the power of 
association among men, which is developed on or 
near to it. Thus is it that the establishment of a 
single factory, machine shop or ship yard, in a local- 
ity which before has not had one, adds to the value 
of all the surrounding land. Perhaps the most valu- 
able ground in the whole world is that in Wall 
street, New York, or in the immediate neighborhood 
of the Bank of England, London. In such places as 
these latter not merely is the power of association 
among the people comprising these communities 
great, but they, through control of credit, largely 
control that power among mankind even to the re- 
motest corners of the earth — a consummation in a 
high degree ot the aims and aspirations of all who 
struggle for individual wealth, w hich merely means 
power to command the services of the largest possible 
body of men. In the light of such facts as these, which 
are of every day's observation, in regard to the effects 
of industries upon the value of land, how false and 
absurd the gabble of those who treat American pro- 
ductive. industries as things which merely inure 
to the benefit of the heads of the concerns which 
prosecute such industries. 

f The man who is firmly planted on the land, and 
that land his own, while he thereby possesses im- 
mensely increased power of association with his fel- 
low-men, through this saving-bank for his labor- 
power, is not- tinder the imperative necessity of in- 
stantly so associating or of turning tramp or beggfu - , 
or of dying of starvation, as is the landless man. 
Land is in fact the complement to man; the two 
making up a, tolerably complete instrument or force, 
while man alone is a very incomplete and dependent 
one. The mass of the people throughout the world 
instinctively recognize this great fact, or rather, the 
traditions of all races have taught it. Hence the 
efforts, the struggles, the aspirations of mankind in 
the past and the present, as they wdll be in the future, 
to possess the land. 

+ The government in 18fi2 called to its aid the 
Greenback, because it was under the neces-ity of 
bringing about a more active and full power of asso- 
ciation between itself and the people, as soldiers and 
sailors, and as the furnishers of transportation, food, 
clothing, munitions of war, coal, ships, etc., than 
the then existing instrument of association was ca- 
pable of doing. When the emergency was over, in 
the most dastardly manner, it almost instantly moved 
in the direction of the abandonment of this new in- 
strument, by contracting its volume, thus throwing 
the burden directly and with crushing effect, upon 
the weak, many of whom were driven to the wall, 
and even to despair, prostitution and suicide; while 
the strong became possessed of their property. And 


16 


Where alone we may look for Light 
and Guidance. 

The orthodox system of political 
economy, with its false fundamental 
doctrines, Hticardo’s theory of rent 
and Malthus’s law of population, and 
its shibboleth, free trade, the chief 
claims to' the acceptance of which 
shibboleth are that it would relieve a 
people from the burden of the duties 
on foreign commodities, which are 
said to be added in the same measure 
to the price of the whole of like domes- 
tic production, and give them things 
cheap, but which we have seen it does 
not do ; a system which ignores the 
fact that civilized man lives and moves 
in an artificial society, will not help 
or guide us in the work before us be- 
cause it has no knowledge of the real 


yet some of the heartless and wicked men who took 
the lead in this infamous work now cry out against 
that “monopoly ” which they thus created, by break- 
ing down the weak and building up the strong, ns 
lustily as they did in 1865-1878 against “ inflation.’’ 
The modern annals of the world may be searched in 
vain for any acts of confiscation and oppression more 
far reaching than these. 

If the government desired to commit the folly of 
bringing about what are facetiously called “ specie 
payments,” in which no specie is used except for 
small change and even but little paper money, but 
where nearly all large payments are made in mere 
bank credits, now more inflated than ever' before, 
it should have done it in a straightforward, hon- 
est, and manly way, as the very poor Italian govern- 
ment is now doing, by the purchase of the specie. 
Then would the burden have fallen on the broad 
shoulders of the government and through it second- 
arily, mildly and by slow degrees upon each and 
every man, woman and child in the land in propor- 
tion to his or her means, through legitimate meas- 
ures of taxation. As it was, the burden was cast off 
by the State, directly upon the people, destroying 
the power of association, involving a loss of not less 
than $80,000,000,000, which mainly fell upon those 
least able to bear it, and inured to the benefit of 
those who were enabled to take advantage of their 
necessities by buying up depreciated property; the 
owners of which still continued to stagger under a 
load of unsatisfied debts. About thirty years ago 
Baron Bunsen stated that theeffects of the thirty years’ 
war, which closed in 1648, had not then disappeared 
from Germany. Neither will the effects of the “ re- 
sumption” of 1865-79, have in two centuries disap- 
peared from among the people of these United States ; 
although the descendants of those of its victims who 
have been “ ploughed under” by it, will be as little 
regarded in that connection as the stubble which 
the husbandman’s plow year after year places 
beneath the surface of the soil. 


0 020 689 970 

and paramount conditions governing 
man in his relations to his fellow- 
men. 

We must therefore once and for all 
wholly dismiss from our acceptance 
and consideration this false system, 
which reasons from assumptions and 
not from facts, and turn to that bright 
and beautiful one of American origin 
and development, so full of hope and 
cheer to man, based upon induction 
and analysis, and through tlf n on the 
real relations of man to hV fellow- 
men, and to the earth which he in- 
habits ; some glimpses of which, indica- 
tive Of TIIE NECESSARY FOUNDA- 
TIONS OF INDIVIDUAL AND NATIONAL 
WELL-BEING AND OF CIVILIZATION, 

I have endeavored to open up to your 
view this evening. 

The Spirit in which this Subject 
should be Studied. 

Let me beg that each of my auditors 
will, to the end that he may see, and 
accept the truth, in the words of Sir 
John Herschel, “ Strengthen himself 
by something of an effort and a resolve 
for the unprejudiced admission of any 
conclusion which shall appear to be 
supported by careful observation and 
logical argument, even should it prove 
of a nature adverse to notions he may 
have previously formed for himself, or 
taken up without examination on the 
credit of others. Such an effort is, in 
fact,” as he adds, “a commencement 
of that intellectual discipline which 
forms one of the most important ends 
of all science. It is the first move- 
ment of approach towards that state 
of mental purity which can alone fit us 
for a full and steady perception of 
moral beauty as well as physical 
adaptation. It is the ‘euphrasy and 
rue,’ with which we must purge our 
sight before we can receive and con- 
template as they are the lineaments 
of truth and nature ” — that truth 

A KNOWLEDGE OF WHICH SHALL, 
INDEED, MAKE YOU AND ALL MEN 
FREE. 


,s*r ■ niW I | |r ' ' '*"**'. 


